Gold demand forecast for 2025 lowered by WGC due to a 12% decrease in consumption during the first half of the year
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The first half of 2025 has seen gold demand surpassing Rs 2 lakh crore in value, according to the World Gold Council. However, the overall demand in volume terms has decreased by 12% compared to the same period last year, with 252 tonnes of gold being purchased.
Investment demand, on the other hand, has shown a positive trend. The investment demand for the June quarter alone was up by 7% to 46 tonnes. This increase is reflected in the value of physical gold demand in Q2 2025, which has increased by 30% compared to the same quarter last year, reaching Rs 1.21 lakh crore.
Despite the surge in investment demand, gold imports into India in the June quarter have decreased by 34% to 102.5 tonnes. This decrease is primarily due to a slowdown in jewelry demand, which was down by 17% to 88 tonnes for the same quarter.
The World Gold Council revised the annual gold demand for 2025 downwards, citing a modest slowdown in central bank demand and the impact of high gold prices dampening jewelry demand. The council's mid-year outlook notes that central bank demand has slowed and jewelry consumption remains weak due to price sensitivity and economic headwinds.
The key reasons for this revision include a central bank demand slowdown, jewelry demand weakness, and economic and geopolitical factors. The council has revised the annual demand estimate for gold to range between 600 and 700 tonnes, down from the previous estimate of 700-800 tonnes for the full year 2025.
Total gold demand from January to June 2025 is approximately 253 tonnes, a 12% decrease from the same period last year. The average quarterly global price per ounce of gold in Q2 2025 reached US$ 3,280.4.
In India, the domestic price per 10 grams of gold in Q2 2025 was INR 90,306.8. Gold recycling in India in the June quarter increased by 1% to 23.1 tonnes.
The World Gold Council states that gold's enduring appeal as a safe-haven asset is clear from these indicators, despite the mixed signals in the first half of 2025. The council remains optimistic about the future of gold demand, particularly in investment areas, but cautions that economic and geopolitical factors could continue to impact demand in the second half of the year.
- In the technology sector, the rise in gold investment demand could provide potential opportunities for financial technology companies to develop innovative platforms for digital gold trading and investment.
- As the global economy continues to evolve, investing in technology-centric industries, such as renewable energy or artificial intelligence, could offer a compelling alternative to traditional gold investments, especially considering the current volatility in gold demand.
